2 New Black Books In July: RH, WSM, PIR, BBBY, KSS, JCP, TGT, WMT, M, ETH, LZB

Takeaway: 1) RH – Roadmap to $300. 2) Broader ‘Launch’ of the Home Furnishings space – will also present results of our Consumer Survey on the space.

A quick note on two Black Books we just put on the calendar in July.

 

July 9th

RH: Roadmap to $300

We’ll be releasing a detailed RH Black Book on July 9th with many new thoughts, ideas and analysis that we have not yet articulated, and ultimately will show RH’s Roadmap to a $300 stock. This will include a full real estate analysis (including productivity and profitability estimates for new stores), quantifying the potential for RH Modern, identifying additional growth concepts/ideas, and detailing RH’s sourcing and vendor networks – which are both critical to its growth, margin structure, and capital intensity. Importantly, we’re also going to stress test our Bull case to see where we could be wrong.

 

July 29th

Home Furnishings Launch/Consumer Survey: WSM, W, PIR, BBBY, ETH, LZB

We’re going to leverage all the work we’ve done on RH and will ’Launch’ more broadly on the Home Furnishings Space.  Relevant tickers (aside from RH) include WSM, W, PIR, BBBY, ETH and LZB – not to mention KSS, JCP, TGT, WMT and M. We think there are some really interesting Long and Short ideas in what is an increasingly bifurcating space. In addition to detail on all these companies and the industry, this Black Book will also include the results of our Consumer Survey on all the different brands/retailers in the Home Furnishings space, and will look at things like price point thresholds for shopping online vs. in-store, spending capacity and shopping patterns for different aesthetics (i.e. traditional vs. contemporary/modern).

 

We also have other ‘sub-sector’ studies in the works, like we’ve already done for Athletic, Department Stores and now Home Furnishings. Specifically those include Dollar Stores, Home Improvement, and e-Commerce.

 


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